Arizona goes after illegal hires

A new law that penalizes employers with illegal workers – if done right – is a model for the US.

December 31, 2007

A new law in Arizona that takes effect Jan. 1 aims to punish employers who hire workers without valid US residency. Even though this experiment is by only one state trying to fix only one piece of the US immigration puzzle, the law may provide answers for the whole nation.

Arizona stands out in illegal hires – about 10 to 12 percent of the workforce. This border state with only 6.2 million people has more illegal immigrants than Illinois or New York. Two-thirds of Arizona's foreign-born population are not in the US legally, and the vast majority of them live at or near the poverty level.

The political impetus behind the law is due in large measure to the state's social services being overwhelmed in recent years by a flood of migrants evading tighter border security in California and Texas. The state, in other words, may represent the United States of the future, unless more is done to address the problem of both illegal (too much) and legal (too little) immigration. Since 2000, the US has seen its highest increase in immigrants, but more than half were illegal.

Arizona is doing the US a favor by going after the prime magnet for border-crossers – companies that offer jobs without checking an applicant's legal status. The new law's punch lies in taking away a business's license if the employer is caught more than once with illegal workers (even ones with fake documents). A similar enforcement effort by the US Homeland Security Department is barely off the ground.

The success of this law depends on how it is enforced. Employers and law-enforcement officials should not use racial profiling to crack down on illegal workers. A certain leniency is needed in how employers use the federal "e-Verify" database: legal workers cannot be harmed by this new nationwide system for checking workers' legal status, which still has an unsatisfactory error rate. And the state must prevent a new type of black market in off-the-book hires.

The law has already withstood an initial legal challenge in federal courts, but a big test is in its effect on the economy. The state's agriculture, service, and construction industries depend greatly on illegal workers as a source of cheap labor. The average household income of illegal immigrants in Arizona is $35,000 per year. For natives, it is $69,000. Will businesses be able to afford higher wages to attract legal workers and still stay in business in the state?

One early indicator may be the price of lettuce. About half of US winter lettuce is grown around Yuma, and if higher wages are needed to attract legal lettuce pickers, consumers will see higher prices in their salads. Or lettuce companies may decide to grow elsewhere.

The Congressional Research Service recently found no "nationwide shortage of domestically available farmworkers." And one economist, Philip Martin at the University of California, Davis, predicts higher wages will force needed mechanization and increased productivity in farming and not significantly raise prices for produce. That was the case, he says, after the "Bracero" Mexican guest-worker program ended in the 1960s.

The best effect of the Arizona law will be in having both workers and businesses operating within US immigration rules. Honesty in the workplace is its own profit.